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Originally Posted by redpoint5
Anyhow, if Tesla is paying more in straight wages, I consider that to be higher pay than including all the other nonsense fluff companies often throw in (how is pet insurance even a thing?).
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Tesla pays less in cash and benefits. Tesla pays their assembly workers about $40 / hour (wages and benefits). The "imports" pay about $55 / hour. A UAW assembly worker brings in about $65 / hour
Quote:
Originally Posted by redpoint5
Being the type to see the positive out of most any situation, increasing UAW labor costs simply speeds along development of automation that will drive down production costs, making goods more affordable for everyone.
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There is little left to automate in a US vehicle assembly plant. Body-in-white and paint are already almost completely automated. Final assembly is VERY hard to automate. The only real automation opportunity left in material handling and that is also highly automated.
At this point the easiest solution is to just shift production from the US to Mexico. Labor is 1/10th the cost and steel is 25% cheaper due to the US import tariffs.
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Originally Posted by redpoint5
...as a tangent, I have suspected for quite some time that the US would onshore manufacturing again due to diminishing need for a labor market due to automation. The pandemic seems to have speed up that process.
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I've seen no onshoring at my company. I have seen an increase in offshoring both in assembly and engineering with Mexico getting most of those jobs. At the tier 2-5 level we have seen a lot of movement out of China and to other Asian countries both to avoid tariffs and because Chinese auto workers make too much now. Vietnam and Thailand are hot locations for new part production right now.
Related to this topic - the UAW strike will only extend shortages of vehicles by taking production offline and reducing inventory. Depending on how long it goes on we could be back to near 2020 levels of lost production.
I expect this to be a long strike as the UAW's asks are not even close to being in the realm of reality and they have a new President that was elected with the promise of bringing back the union glory days of the 70's.
GM's current offer is $82,000 in base wages and $150K a year in wages and benefits. The UAW called that poverty wages.
On the other hand Ford just made a deal with their Canadian union workers for a 19% raise over 3 years (10%, 2%,3%). At the end of 3 years a top rate Canadian worker will make $33 / hr (USD) which is $1 more than what a Ford UAW worker in the USA makes today. They also got yearly inflation cost of living adjustments and workers will go from the base rate to top rate in 4 years instead of 8.
The UAW wants $43 / hour in year 1 and $62 / hour in year 4 in base wage. Add in benefits and the UAW is asking for between $135 and $150 per hour depending on how you calculate the cost of healthcare for life.